Timely Delivery

Careful planning and a clear mission allowed Abbey National to quickly push its products and services into e-commerce delivery channels.

To stay competitive in today's constantly changing financial services marketplace, bank executives are being forced to act at "Internet speed," andintegrate with innovative delivery channels almost overnight. Some of these implementations have been successful, others less so, much to the
detriment of the bank.

Abbey National, a U.K.-based bank, is one of the success stories. In little over a year, this $300 billion institution went from an e-commerce neophyte to
an e-commerce contender, in many respects more advanced than a number of its better-known competitors.

The need to become Internet accessible was spurred by a corporate decision to become a major player in the e-commerce space. Abbey National
launched a campaign around the slogan "Because Life's Complicated Enough," a vow to its 15 million middle-market customers that they would simplify
banking transactions by becoming Web friendly.

The problem was that when Abbey National initially made this promise in September of 1999, the former British building society (similar to a U.S.
savings and loan) had no online transactional and few interactive capabilities. But by September 2000, it boasted a broad mix of products and services
served up not just from the screens of PCs, but also via interactive digital TV, cable, satellite, terrestrial aerial and even a pilot wireless application
protocol (WAP).

Formula For Change

Remaking the delivery portion of a major financial institution in a single year is a significant accomplishment. In the case of Abbey National, this
process included strategy development, technical assessment, alliance negotiations and the complete implementation of a new delivery channel. Bank
executives said the following elements were crucial in each of these steps:

- Leadership-A strong management team is needed for a successful online conversion. This team should set and make aggressive deadlines; hire and
retain the best help available; and occasionally ask "why not," since people often claim that something is impossible when it really isn't.

- Taking time to plan properly-Abbey executives realized that in order to implement quick changes, they had to spend time on the front-end developing
a realistic mission and strategy. The strategy development project had a 90-day timeline culminating in a December board presentation. During this
phase the team scoured the world for best practices, learned the U.K. competitive landscape, developed clear financial and operational objectives and
defined a technical roadmap.

The decisions that were made during the development of the strategy allowed the organization to react to opportunities faster than the competition and
gave the team a clear view of what they wanted to accomplish. By slowing down to "think," Abbey National was actually able to execute quickly.

- Consideration of both bricks and clicks-Abbey National's new retail strategy was based upon an integrated channel capability and focused primarily on
the bank's existing retail population. The physical (bricks) network was an important component of the overall strategy-by leveraging it, the Bank was
able to introduce customers to the online offerings and its clear advantages.

The clicks component of the offering is where Abbey National differentiates itself from both U.K. and U.S. banks. Early on, it was decided that the
organization would be "appliance agnostic" and allow customers to access the same information and capability regardless of channel or device. This
philosophy was the genesis of Abbey National's investment in technology that is WAP and Internet compliant.

The "all appliances at all times" theory also drove the bank to make sure its services were cable, satellite and terrestrial friendly so customers could use
interactive TV to access accounts. This gambit is paying off-television mediums are generating significant volumes for the bank, executives said.

- Willingness to consider alliances-The ability to enter into alliances is an important facet to a successful retail launch into e-commerce space. Abbey
National's overall strategy was to offer its customers a suite of bundled financial and non-financial products and services based upon relevant life
events. Alliance partners were chosen to either provide or enhance each of these new offerings. These alliances were chosen after an extensive analytic
exercise where each potential partner was evaluated against a common group of measures.

- Keep it simple and true-Abbey National's brand promise, "Because Life's Complicated Enough," was a powerful tool to align the e-commerce strategy
for the retail bank. Staying true to this philosophy defined the look and functionality of the online offering and met with great support from consumers.

Experience has proven that customers want the maximum functionality with the least complexity. In fact, the less clutter, the more attractive the
offering.

Abbey National's experience has numerous implications for North American financial institutions. Chief among these is the probability that, given a
focused strategy and a confident management team, outstanding retail delivery successes can be achieved even in a highly compressed timeline.

About The Authors: Bill Currie is a principal and Janet Rodger is a senior manager with Deloitte Consulting's Financial Services Practice.